This paper is a contribution to economic geography that leans on cooperative game theory. In particular, we envision towns (that are protected by walls) versus countryside where such protection is missing. An extension also provides a basic theory of when trading routes will be protected.

This paper analyzes the incentive effects of special bank resolution schemes which were introduced during the recent financial crisis. These schemes allow regulators to take control over a systemically important financial institution before bankruptcy. We ask how special resolution schemes...

The aim of this paper is to analyze the interconnections between employment and unionization. We will also see how unemployment benefits drive the interplay of employment and unionization. The basic input into our model stems from cooperative game theory. Building on the Shapley value, several...

The paper deals with household theory from the angle of Buddhist thought. We build on the Buddhist terms of tanha versus chanda to express Buddhist preferences and Buddhist household theory in terms of textbook microeconomic terms. We find that preferences of Buddhist (enlightened) people may...

The paper provides a simple model for interbank loans. Since interbank trades are usually over-the-counter transactions, we use a bilateral bargaining model and apply the Nash bargaining solution. We determine the threat points and the bargaining frontier of debtor and creditor banks. We ask...

The paper presents a coalition-structure value that is meant to capture outside options of players in a cooperative game. It deviates from the Aumann-Drèze value by violating the null-player axiom. We use this value as a power index and apply it to weighted majority games.

The question of entry deterrence in a Schmalensee type product differentiation market, that is in a market that can be depicted by a circle with circumference of 1, is investigated. It is normally assumed that incumbent firms or brands locate equidistantly whereas an entrant settles exactly in...

Compatibility influences business strategy and market structure and can itself be the outcome of market forces. This survey tries to summarise the field of compatibility with respect to business strategy. Two business strategy questions are the focus of survey. First, what kind of behaviour is...

What kind of economic activity is conducted through markets and what kind is conducted through firms? We approach this Coaseian question by way of an employment relation between players. Every player has an endowment of 100% of his time. He may choose to give away part of his time to other...